[Bitcoin](https://inleo.io/@leoglossary/leoglossary-bitcoin) is something that gets a lot of attention these days.  When it comes to dealing with the problems we presently face, many will tell us Bitcoin is the solution.  Is this really the case?


To answer this question, we need to dive into many different pools to see what is going on. 


[Bitcoin maximalists](https://inleo.io/@leoglossary/leoglossary-bitcoin-maximalist-maxi) promise us that Bitcoin will solve all that ails us.  It is the solution to our [money](https://inleo.io/@leoglossary/leoglossary-money) problems and will make the [world](https://inleo.io/@leoglossary/leoglossary-world) a better place.  For years, we were told this is "the people's money".  


Throughout that time, some asserted that Bitcoin was a creation of the NSA, CIA or some other alphabet agency of the US [government](https://inleo.io/@leoglossary/leoglossary-government).  Others content it was some concerned for humanity [cypherpunks](https://inleo.io/@leoglossary/leoglossary-cypherpunk).


Whatever the original, we will delve into it in this article.

<center> https://i.imgur.com/t4Fxn77.jpeg
Image created using Ideogram </center>


# Bitcoin On A Path To Tyranny?


Could Bitcoin take us even deeper into a tyrannical state around the world?  We will look at the different facets of the system to come up with an answer.


Before getting into that, let us start by highlighting what the most valuable contribution of Bitcoin.  It certainly was revolutionary.  While many focus upon the money, there is something that forever changed the world.


Bitcoin biggest contribution to humanity was the ability to arrive at [consensus](https://inleo.io/@leoglossary/leoglossary-consensus) in a decentralized manner.


Think about that for a second.  This is the first time in [human](https://inleo.io/@leoglossary/leoglossary-human) [history](https://inleo.io/@leoglossary/leoglossary-history) this was possible.  Our entire system is filled with "trust agents", institutions that are designed to have provide confidence to the general public.  Unfortunately, we all know how this can fail.


Previous attempts at electronic [currency](https://inleo.io/@leoglossary/leoglossary-currency) ran into a wall when it came to consensus.  It was Bitcoin that pushed through the barrier and gave the world its greatest gift.  


Over the next few decades, we will likely see a massive amount of disruption as trust is realigned, employing decentralized consensus mechanisms.  This will extend far beyond simply facilitating financial [transactions](https://inleo.io/@leoglossary/leoglossary-transaction).


Which brings us to Bitcoin.  


One thing we have to establish is the two factors that apply to this network.  [Coin](https://inleo.io/@leoglossary/leoglossary-coins) distribution has nothing to do with the [network](https://inleo.io/@leoglossary/leoglossary-network).  That is rather unique and requires looking at both individually.


## Network


The Bitcoin network employs the [Proof-of-Work](https://inleo.io/@leoglossary/leoglossary-proof-of-work-pow) consensus mechanism.  


From the outset, the goal was basically to back the system with [energy](https://inleo.io/@leoglossary/leoglossary-energy-industry).  Presently, specialized [computers](https://inleo.io/@leoglossary/leoglossary-computer), all over the world, work to solve mathematical equations in an effort to earn the right to produce the next [block](https://inleo.io/@leoglossary/leoglossary-block).  


What started out as something that was done using a basic computer now requires expensive hardware.  [miners](https://inleo.io/@leoglossary/leoglossary-miners) can run into the tens of thousands of dollars apiece and often require a multitude to make any money.  This is why [mining](https://inleo.io/@leoglossary/leoglossary-mining) pools became so popular.


Here is where the first problem can arise.  


In the United States, there are 5 mining [companies](https://inleo.io/@leoglossary/leoglossary-company-business) that are publicly traded.  Blackrock is [investing in 4 out of the 5](https://finbold.com/blackrock-is-a-major-shareholder-in-4-of-the-5-largest-bitcoin-miners/).  


The running of the network in a decentralized manner is crucial.  What happens if [Wall Street](https://inleo.io/@leoglossary/leoglossary-wall-street) institutions and [venture capital](https://inleo.io/@leoglossary/leoglossary-venture-capital-vc) firms start to drop big money on the mining companies?  We can follow the one that are on public [markets](https://inleo.io/@leoglossary/leoglossary-market).  We honestly have no idea what is taking place with the private miners.


Naturally, there are entities all over the world yet they all face the same problem.  This is not a network run by thousands of individuals.  There are a handful of entities that control the majority of the [hash](https://inleo.io/@leoglossary/leoglossary-hash).  Could that be leveraged over time?


Some will claim it is impossible.  That might be the case.  However, a [51% attack](https://inleo.io/@leoglossary/leoglossary-51-attack) take place if Wall Street and associated entities start to [gain](https://inleo.io/@leoglossary/leoglossary-gain) control.  If it becomes a money game, they excel at this.


## Coin Distribution


From a network perspective, this means nothing.  Nevertheless, it is a part of the [narrative](https://inleo.io/@leoglossary/leoglossary-narrative) pertaining to Bitcoin as a new form of money.


If this is the case, we have a major problem. 


Historically, fixed money always pools.  Bitcoin is no different.  Early on, people took exception to that idea yet we see it happening before our eyes.  Wall Street is completely hijacking Bitcoin and many are cheering.


For years people applauded [Michael Saylor](https://inleo.io/@leoglossary/leoglosary-michael-saylor) and his firm's buying of Bitcoin.  The same results were met when the [Bitcoin ETF](https://inleo.io/@leoglossary/leoglossary-bitcoin-etf) was approved by the [SEC](https://inleo.io/@leoglossary/leoglossary-securities-and-exchange-commission-sec).  


In the last two months, the money pouring into those [funds](https://inleo.io/@leoglossary/leoglossary-fund) has exploded.  The Bitcoin held by [Blackrocks now surpasses Microstrategy](https://www.msn.com/en-us/money/other/blackrock-s-bitcoin-etf-beats-microstrategy-in-btc-holdings-in-just-two-months-of-launch/ar-BB1jGNH2).  All of this is being held by some Wall Street firm acting as the [custodian](https://inleo.io/@leoglossary/leoglossary-custodian).


So much for the "not your keys, not your coins".


If people like Saylor are correct, what kind of world will we have if Bitcoin is indeed the main form of money?  Do you think everyone will have it?  Fixed money always pools and this means most people will not have any of it.


## Transaction Fees


This could be an article unto itself so we will touch upon some of the highlights.


Bitcoin is a very inefficient network.  There could be a case made that the [security](https://inleo.io/@leoglossary/leoglossary-security) provided is worth the inefficiency.  However, outside of that, it is not designed to handle many transactions.


Since it doesn't scale, the fees respond by increasing along with activity.  This impacts the utility of the network especially on smaller transactions.


The response to this is to move the transactions to a second [layer](https://inleo.io/@leoglossary/leoglossary-layer-insurance).  Presently, we see the [Lightning Network](https://inleo.io/@leoglossary/leoglossary-lightning-network) as the probable answer.  The challenge here is Bitcoin [incentives](https://inleo.io/@leoglossary/leoglossary-incentivize) are only on the [base layer](https://inleo.io/@leoglossary/leoglossary-base-layer-blockchain).  There is no incentive structure for Lightning.


This calls into question who is going to run these nodes?  Some believe that people will simply do it from the perspective of being anarchists or "sticking it to the man".  While a few might, that isn't going to process billions of dollars worth of activity.


For that to occur, some big players have to step who.  What institution is going to do this without incentive?  The answer is nobody.  Hence, the solution is gaining value in some other way.  Is there a way to take activity that occurs on your network that [costs](https://inleo.io/@leoglossary/leoglossary-cost) you money yet you end up monetizing?  This is the [social media](https://inleo.io/@leoglossary/leoglossary-social-media) scenario, perfected by [Facebook](https://inleo.io/@leoglossary/leoglossary-facebook) (Meta).


A logical conclusion is major [financial institutions](https://inleo.io/@leoglossary/leoglossary-financial-institution) will run [nodes](https://inleo.io/@leoglossary/leoglossary-node) since they can monetize in other ways.  The cost is simply one of doing [business](https://inleo.io/@leoglossary/leoglossary-business) and they can augment their other services through this.  Of course, this brings up the proverbial [KYC](https://inleo.io/@leoglossary/leoglossary-know-your-customer-kyc) and having to adhere to [regulations](https://inleo.io/@leoglossary/leoglossary-regulation).  


It would appear this layer is going to be hijacked also.  Even if the miners remain unimpeded, far from a guarantee, the fees might be so high it is unusable for the average person.  If it costs $1K for a transfer, it is going to exclude a lot of people.


The only solution is, so far, Lightning.  Yet what happens if this is mostly run by major entities that all have KYC.  We are right back in the hands of the banking cartel.


## Green Candle People


Most of the excitement around Bitcoin (cryptocurrency in general) is "price go up".  This is not necessarily a negative since people making money is a positive.  However, when it comes to Bitcoin, there is a lot of short-sightedness.


Becoming a Bitcoin millionaire is a wonderful thing.  That said, it does not mean one is free.  Have you noticed what the US Government did to Russian assets?  It froze the [accounts](https://inleo.io/@leoglossary/leoglossary-account) that are held by individual Russians, not the government.  They were not freezing Putin's money. 


Now there is a push to take that money and give it to Ukraine to pay for the [war](https://inleo.io/@leoglossary/leoglossary-war).  


The lesson hear is these governments have no problem weaponizing the financial arena.  What happens if you have a few million in Bitcoin and you are targeted?  If you don't think it could happen, consider this:


For the sake of discussion, let's presume the [power](https://inleo.io/@leoglossary/leoglossary-power) shifts East.  Instead of Wall Street, it is the giant Chinese [banks](https://inleo.io/@leoglossary/leoglossary-bank) that start to take over.  They invest in the mining pools, run Lightning nodes, and are the massive financial center.


Next, in our scenario, the Chinese government decides it will freeze the Bitcoin of all US citizens.  While this might not be possible on the main layer, the [transaction fees](](https://inleo.io/@leoglossary/leoglossary-transaction-fee)) might prevent movement for most of the money.  Here is where you want to turn to Lightning but, surprise, the Chinese banks do not allow it.


Hence your money is effectively frozen.


Is this far-fetched?  Considering what is happening with Wall Street, I do not think it is.  There is one thing we can  all agree upon, the [bankers](https://inleo.io/@leoglossary/leoglossary-banker) are not going to act in the interest of the average person.


## Tyranny


The problem with tyranny is it changed.


While it is easy to point to a North Korea, that is not how tyranny happens in the 21st century.  Governments tend not to be direct their their exertion of power.


What we described here is exactly how governments operate.  They do not control the population.  That is too difficult.  Instead, they put the screws to the institutions that people deal with.  This way, they are dealing with a handful of players who they can control.


This is usually done through a combination of force and incentives.  The banks, as an example, are regulated while also allowed to get away with what would be [crimes](https://inleo.io/@leoglossary/leoglossary-crime) by anyone else.  It is far easier for the government to control [JP Morgan](https://inleo.io/@leoglossary/leoglossary-jp-morgan-chase-and-co) as opposed the 66 million [customers](https://inleo.io/@leoglossary/leoglossary-customer) Chase has.


We will have to watch but the hijacking of Bitcoin by Wall Street, on the different levels, is cause for concern.  It ultimately could feed into the hands of governments as they will be able to exert complete control over it, albeit indirectly.


Either way, I do not think it is the path to freedom many assert.  


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